Nigeria experiences worst economic recession in 29 years

- The inflation rate shrank at 17.1%, the GDP had contracted by 2.06%, the economy -- by 0.36%

The National Bureau of Statistics (NBS) has released a report on Nigeria's economy in the second quarter, including the Gross Domestic Product (GDP), inflation, employement and unemployement, capital importation and other key fundametals.

According to the report, the GDP has declined by 2.0%, the inflation has risen by 17.1%, the economy has contracted by 0.36% in the first quarter.

Oil

Oil price has crashed to less than $50 per barrel. Nigeria’s production output has tumbled by over 400,000 barrels due to militancy activities in Niger Delta region.

Oil production plummeted to 1.69 million barrels per day in in the seconf quarter of 2016, down from 2.11 million barrels per day in the first, with oil-based GDP contracting by 17.5% in quater two compared to 1.9 % in the first quarter.

Naira

The naira remained at record low of N423 per dollar in the black market, as dollar exchanges for 365.25 in the inter-bank market this month.

Employment

Meanwhile, 4.58 million Nigerians have become jobless since last year, adding 2.6 million to unemployment figures of 1.46 million recorded in the third quarter of 2015 and 518,102 in the fourth quarter of 2015.

The report reads in part: "During the reference period, the number of unemployed in the labour force increased by 1,158,700 persons, resulting in an increase in the national unemployment rate to 13.3% in Q2 2016 from 12.1 in Q1 2016, 10.4% in Q4 2015 from 9.9% in Q3 2015 and from 8.2% in Q2 2015.

In view of this, there were a total of 26.06 million persons in the Nigerian labour force in Q2 2016 that were either unemployed or underemployed compared to 24.5 million in Q1 2016 and 22.6 million in Q4 2015."

Value of capital imported into the economy

"The total value of capital imported into Nigeria in the second quarter of 2016 was estimated to be $647.1 million, which represents a fall of 8.98% relative to the first quarter, and a fall of 75.73% relative to the second quarter of 2015.

This provisional figure would be the lowest level of capital imported into the economy on record, and would also represent the largest year on year decrease. This would be the second consecutive quarter in which these records have been set.

The continuing decline in the value of capital imported into the economy is symptomatic of the difficult period that the Nigerian economy is going through."

It is belived to be the worst economic recession in 29 years. Nigeria’s economy was last in recession, for less than a year, in 1991, tt also experienced a prolonged recession from 1982 until 1984.

Reacting to the NBSsad statistics, Finance Minister Kemi Adeosun said: "It’s the worst possible time for us. Are we confused? Absolutely not. How are we going to get ourselves out of this recession? One, we must make sure that we diversify our economy.

There are too many of us to keep on relying on oil. We can see what happened at the output data of the oil and gas sector. What’s happening in the Niger Delta has dragged down the GDP of the entire economy. We’re too dependent on oil whereas 87 per cent of our GDP is oil.

So let us drive those other areas. We are extremely focused. We know that if we can just bear and get through this difficult period, Nigeria is going to be better for it."